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On January 1, 2018, Platz Company issued $400,000 of 8%, five-year bonds payable at 107. Platz Company has extra cash and wishes to retire the
On January 1, 2018, Platz Company issued $400,000 of 8%, five-year bonds payable at 107. Platz Company has extra cash and wishes to retire the bonds payable on January 1, 2019, immediately after making the second semiannual interest payment. To retire the bonds, Platz pays the market price of 94. Read the requirements. (Assume bonds payable are amortized using the straight-line amortization method.) Requirement 1. What is Platz Company's carrying amount of the bonds payable on the retirement date? The carrying amount of the bonds payable on the retirement date is $ ho Requirement 2. How much cash must Platz Company pay to retire the bonds payable? To retire the bonds, Platz Company must pay $ Requirement 3. Compute Platz Company's gain or loss on the retirement of the bonds payable. (Use parentheses or a minus sign for losses.) Platz Company's gain or loss on the retirement of the bonds payable is $
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